THE 21ST CENTURY CMO PLAYBOOK - Kuno Creative

THE 21ST CENTURY

CMO PLAYBOOK

Being a CMO will be one of the most interesting, but

also one of the toughest jobs in the 21st century.

Consider the context: consumer behaviour is changing

faster than the planning cycle of marketing campaigns,

marketing technology is becoming the most complex

part of the enterprise stack while the rise of agile,

ruthless competitors from new markets means that

brands have to achieve global scale to avoid imitation

and replication.

1THE 21ST CENTURY CMO PLAYBOOK


The average household watched television at dinner time,

read the newspaper at breakfast, listened to the radio on

the way to work, and enjoyed magazines in between.

Today, consumers have multiple devices, intelligent

objects and networked screens surrounding them.

They are exposed to as many as 10,000 ads per day.

More than 4.4 billion people, or about 60 percent of

the global population, have cell phones, according to

2014 figures from IC Insights. About 2.5 billion people

are on the Internet.

Technology is changing marketing, but that doesn’t

mean that the CMO of the future should act like a CIO.

High performance CMOs don’t need to manage and

provision IT systems, but rather what it takes to push

technology to its limits in the service of transforming

customer experience.

That should come as no surprise. Of all the roles in the

business, marketers have always been closest to the

customer and the market. What has changed in the

21st century is not the focus of the marketing team, but

the source of their insights. In the past, focus groups,

market research studies and advertising agencies were

reliable channels of consumer information. No longer.

Marketers must be data natives. Like high frequency

traders, they have to design platforms and deploy

resources so that they are always in the middle of real-

time data streams, constantly testing and adjusting

their market interventions.

Data is the lingua franca of the modern enterprise.

Finance, HR, IT, customer care, marketing and

operations are all moving into the Cloud, becoming

more integrated and automated. As that happens, data

will change from being something used to describe

past events - to a currency of real time value that can

be used to not only predict what might happen next, but

actually shape the design and delivery of your product.

Why measure brand awareness, when you target a

specific individual? In the data driven enterprise, it is

possible to track the lifecycle of a customer—as they

undertake their journey from an initial brand discovery,

through to trial, purchase, evangelism and upgrade.

With that information at your disposal, there is nothing

you cannot achieve.

You can literally design an entire company

to serve a single person.

Things were once far simpler.

The platform doesn’t matter. How people use it, does.

http://www.icinsights.com/news/bulletins/Worldwide-Cellphone-Subscriptions-Forecast-To-Exceed-Worldwide-Population-In-2015/

We are moving into the era of hyper-personal business.

Already, no one sees the same retail home page at

Netflix or Amazon, nor the same newsfeed on Twitter

or Facebook. These are companies built to scale for

millions of customers, but fashioned to serve just one

at a time.

Embracing data has real rewards. According to

McKinsey & Company, companies that are more data

driven are 5 percent more productive and 6 percent

more profitable than other companies. If anything, that

understates the case. Can you really say that Netflix is

simply 5 percent more productive than a TV network, or

Amazon slightly more effective than another retailer? In

truth, they are entirely new kinds of businesses.

Change is not easy. Marketers have been schooled to

think in channels, not customer behaviours, to measure

their success through abstractions not algorithms, to

create strategy not run experiments, and to applaud

advertising that wins awards not customers.

Embracing a new marketing playbook will be

confronting both for you as a leader, as well as for the

rest of your team. But doing nothing is no longer an

option. Your customers will force you to change long

before your shareholders do.

This book features 10 insights for CMOs to consider. It is by no means an exhaustive list, but hopefully it will provide you with

a rough sketch of a new kind of marketer. One who, aside from their data

fluency, combines a fervent customer obsession with a tactical ability to

orchestrate the complexity at the heart of tomorrow’s enterprise.

10

The next generation of companies will do just that.


Redefine Your Metrics

Buy Programmatically

Communicate Effectively With Data

Structure Your Team For

Success

Automate,Then Elevate

Forget Funnels,Focus On Journeys

Think Like A Media

Company

7

8

9

Build A Strong Relationship

With IT

10

3

4

6

5

10 INSIGHTS FOR CMOs


Solve Problems, Don’t Manage

Channels

2Design

Your Business With Data

1

Design Your Business With DataAfter leaving Harvard, Jennifer Hyman and Jennifer

Fleiss had the insight that women might rather rent high

fashion items than own them. Fashion is expensive and

has a limited shelf life. The two founders decided to start

a company based on a simple idea – a woman should

never have to wear the same outfit twice, and shouldn’t

have to buy it at all.

Rent the Runway was born. Many of their earliest

customers were Millennials, who intuitively understood

the value of access rather than ownership. After all, if

you can use Spotify to listen to music rather than buying

albums, and Uber to get to places rather than owning a

car - how hard might it be to ‘stream’ a designer dress?

As it turns out—more difficult than it might seem. In their

early years, Rent the Runway struggled to meet their

targets. It took a radical mindset change in marketing

to turn things around. The founders realized that to fix

engagement, they needed to focus their efforts on data

science, pricing models and their mobile platform.

Like Amazon, Rent the Runway had to become a logistics

and data business, not merely a retail and fashion

one. Their new data driven approach paid off, and now

the company ships more than 90,000 items a day to 5

million members, and not surprisingly, also operates the

country’s largest dry-cleaning facility.

For CMOs, the story of Rent the Runway illustrates the

central role that data plays in business today. No longer

just a measure of past activity, it has become a pro-

active metric capable of changing your entire approach

to customer value creation. Data is not just for IT geeks,

it belongs at the heart of your growth strategy.

“Data’s a big part of our business, encompassing

everything from the whole fashion component to metrics

around utilization of a given dress,” Jennifer Fleiss said in

an interview with Forbes last year. “We have an analytics

team of six people internally, who look at rental statistics,

such as how many long dresses get rented, how many

short, how many red, black, orange and so on. What

trends worked last season, what fabrics last the longest,

which dresses are being turned and utilized the most?”

Ultimately, for smart marketers, data changes the way

you design your business. Rather than buying their

dresses from retail, Hyman and Fleiss now partner

with designers - providing them data on what styles

are the most popular in return for discounts and better

availability of sizes. In the same way that Netflix

uses data from its customers to commission original

programming, Rent the Runway has approached

emerging designers to create collections exclusively for

their platform.

1


Solve Problems, Don’t Manage ChannelsThe problem with today’s advertising industry is not what they do, but the way they sell what they do. Rather than solving your problems, they pitch fragmented solutions based on their own internal structures.

You know the drill. Creative agencies want you to make expensive TV spots. Graphic design firms recommend that you

update your corporate identity and packaging. PR firms suggest a big launch party while digital agencies put together

a plan involving micro-sites and a flashy media buyout of high traffic websites. Basically, when faced with your brief,

agencies tend to solve for their own channels.

Unfortunately, while agencies might think in channels, customers do not. Today’s consumers are both sophisticated

and demanding. They interpret brand signals from a wide variety of sources, and expect consistent treatment regardless of

the platform they are using. Winning their attention is an exercise in problem solving, not ticking the boxes.

I met Johnny Vulkan a number of years ago, when we were both speaking at a conference in Oslo together. His agency,

Anomaly, has attracted some of the biggest clients in the world including P&G and Google based on their unique

approach. Although they don’t call themselves an ad agency, they conceived and produced the most popular Super

Bowl ad two years in a row. They are not a design company, and yet they designed the number one lip balm in the U.S.

They are also not a broadcast media company, but they have won awards for the cooking show they produce.

In Vulkan’s view, what makes Anomaly successful is not what they do, but how they approach their work. When they

start working with a client, their first goal is to clearly identify and articulate their problem. Carl Johnson, one of

Anomaly’s other founders cites Charles Kettering as inspiration, the famed inventor and head of research for GM, who

said, “A problem well stated is a problem half-solved.” Once the real marketing issue has been identified, the Anomaly

team is able to select the right set of tools, people and platforms most relevant to fixing it. If the right answer is better

packaging, then that is what the team does - even if making a TV commercial might have meant more fees.

2


As CMOs become more sophisticated in the way they buy marketing services, it is not just individual agencies that will need to adapt their approach, but also entire marketing networks.

I recently joined the board of The North Alliance (NOA), a collection of marketing companies that originated in

Scandinavia but has since established a global footprint. NOA was founded by Thomas Hogebol, a former head of

McCann Worldgroup in the Nordics. Backed by private equity, the management group acquired the best creative and

digital agencies from Stockholm to Copenhagen, Oslo to Warsaw - combined with an engagement model that allowed

clients to tailor-make a dream team of problem solvers from a diverse talent pool, whilst retaining regional scale.

One of NOA’s first regional clients was Scandinavian Airlines (SAS), the leading airline in the Nordics. SAS were

facing growing competition in its market from low cost carriers. Like many brands, much of its communication was

traditional - not just in choice of channel, but also in the style of messaging. When it spoke to customers, it picked

concepts it believed were important to travellers—price, reliability and the speed of its fast-track service. Interestingly,

once the NOA team started analyzing the issue, it became clear that people were willing to pay a premium for their

travel tickets –not because the service was efficient, but because they wanted to be part of a community, to feel the

joy of travelling and share those experiences with other people. Acting on this insight presented its own challenges.

Clever creative was not enough. To enhance SAS’s community platform would require fundamental changes to

commercial strategy, the loyalty program and the underlying technology infrastructure. Hence, a very different type of

agency engagement model.

CMOs face the paradox of actionability daily.

They have the clearest visibility of the customer’s unmet needs. However, acting on those insights requires big

changes, both in the design of their own teams, as well as the way they work with external agencies.

As Hogebol puts it, “CMOs may have larger IT budgets than the CIOs in the future, but they will also need fewer

partners that understand more. The best place for CMOs to start is by clearly defining what their real problems are,

agnostic of media and channels. From that perspective, they can direct their energy and investments on exactly the

ideas most likely to transform their business.”

2


Structure Your Team For SuccessOne of the most important decisions a CMO can make is how they organize their marketing team.

Team structure is the ultimate reflection of what a company’s leaders see as important. Do you organize around

functions, customers or markets? What capabilities do you keep in-house and what do you outsource? What activities

are better left to automation, and what should only be trusted to human creativity?

Traditional marketing organizations were largely structured around channels. Reporting to the CMO were divisional

heads of product, strategy, advertising, research, promotions and communications - all running their own individual

teams and in many cases, entirely separate agendas. Not surprisingly, that led to debates over dogma - whether

advertising was more effective than PR, whether online was better than TV, or above the line was better than below the line.

Once you shift your focus, even if you keep much of your existing marketing team in place, their performance should be

measured against contribution to business growth, rather than their own obscure metrics for success.

3

In the 21st century marketing organization, there should be only one debate:

What does it take to engage and sustain a profitable customer relationship?


In my view, here are the top five capabilities that modern marketing organizations will require:

3


Agile Product Management is the team responsible for your portfolio

of products and services. If your company has a significant technology

component to your offering, you don’t have the luxury of long lead times

between product launches. Technology companies are expected to provide

a continuous delivery of innovation and services to their customers. That

means your product management teams need to be agile, able to identify

evolving customer needs and to translate those needs into new features, while

articulating where your business is going next.

Marketing Operations are your infrastructure and analytics people.

They are responsible for planning, analysis, performance management

and budgeting - as well as serving as a liaison with the IT department on

the management of technology and platforms. In a data driven business,

marketing operations are also an essential resource for the setting and

tracking of company wide engagement and conversion metrics that provide

evidence of the contribution made by your team.

Brand Strategy takes a long term view of your brand. They are the team

responsible for positioning, segmentation, buyer profiling, visual identity and

the definition of your brand values. Brand strategy is not an island, but rather

an airlock that facilitates access to external consultants and agency experts

to challenge your thinking. Like creative directors at luxury brands, your brand

strategists need to not only reflect the current market, but also be far enough

in front to push and drive it.

3


Growth Management is the engine room of your business. They support

your revenue goals through lead generation, database nurturing and the

design of automated workflows that convert leads into customers. Think of

Growth Management as a mashup of marketing and sales. In the old days,

when those two functions were entirely separate it was easy for marketers to

complain that sales people didn’t convert their leads, and for salespeople to

argue that their leads were no good. In the modern enterprise, both roles must

be integrated. That way, the same metrics that measure customer acquisition,

conversion and retention apply to everyone.

Storytelling is an amalgamation of your communications, creative services

and content operations teams. Based on your brand strategy and product

roadmap, their role is to create and distribute stories that engage potential

customers, influential bloggers, consumer media or industry analysts. Great

examples of this function in action include Microsoft Stories or the team

at GoPro that curates customer footage on their YouTube channel. Since

storytelling is a real time phenomenon, you need to build a technically

creative team with the authority to distribute and publish in response to

events as they happen.

If there is a secret ingredient to the marketing department of the future, it is alignment. How many people you hire and

what titles you give them is not as important as having a common set of objectives, and a common language of data.

When the CMO talks to his direct reports and they talk to their teams, it has to be in the context of data driven evidence,

rather than opinion, gut instinct or ego. A blog article can be as valuable as million dollar TV commercial, if you take a

holistic and scientific view on the data behind contribution and conversion.

By building your team from the ground up with a focus on growth and performance, tomorrow’s CMO can not only redefine

their relationship with their CEO, but also the function of marketing inside the business.

A REAL-LIFE EXAMPLE:

How HubSpot Structures Its Marketing TeamYou would expect a marketing automation company like Hubspot to take an innovative approach to structuring their marketing team. And it does. HubSpot has structured its marketing department to align with each step of the inbound marketing sales cycle. Each team is measured by how well it achieves its primary function.

“I threw my old org chart in the trash when I joined HubSpot and started from the beginning. We built our entire company for the inbound era, from marketing to sales to service, because the buyer has all the power today and you need to realign your company for that. I think our org chart is the future of the marketing org because of that – we focus on an inbound

experience that the buyer drives, with us providing value along each stage.”

- Mike Volpe, HubSpot CMO

The Demand Generation Team is responsible for nurturing leads that can be passed along to sales. Its activities include lead nurturing, lead scoring, sales alignment and workflow optimization.

The Product Marketing Team oversees the HubSpot website, creates educational content about HubSpot’s products and teach the company’s sales teams to sell them.

The Content Team focuses on attracting visitors to the website with inbound blogs, articles and whitepapers, as well as creating educational resources and offers. It’s a dedicated function allowing it to serve multiple clients within the business from demand generation to PR and sales enablement.

HubSpot’s Brand & Buzz Team handles relationships with the media and other influencers, as well as events and advertising.

11

CMO

VPProduct

Marketing

VPDemand

Generation

VPBrand & Buzz

VPContent

Creative Director

Design & Multimedia

Influencer Relations

PR Events Blogging

Educational Resources & Offers

Inbound Marketing Manager Inbound Marketing Manager(Persona-Specific)

Web Development

Product Marketing Managers - Product

Launches

Product Marketing Managers - Sales

Enablement

Inbound Marketing Manager International Marketing

Customer Marketing

Marketing Ops

Growth Hacker

Automate, Then ElevateIn some ways, the future of marketing is not about departments, but rather platforms. The more you can automate the routine, transactional elements of customer engagement, the more time your team can spend elevating their activities to be more strategic.

Greater automation is a function of rising complexity. Data driven marketing operates on a scale beyond the capacity

of individual humans to manage. Williams-Sonoma, for example, leverages big data and a Hadoop platform to enable

marketing campaign budgets to be allocated to individual customers, not just segments of customers. Target’s data

mining algorithms were so infamously effective - they figured out a teenage girl was pregnant before even her parents did.

You can only achieve this level of precision with algorithms and workflows, rather than analysts and spreadsheets.

Most companies will benefit from evaluating a marketing automation platform that combines data analysis with the

ability to serve targeted content and customer offers. Software companies like Eloqua, Pardot, Hubspot and Marketo

started off as platforms for managing smart landing pages, product blogs and drip marketing campaigns. Now,

however, they are evolving into broader marketing management tools.

Traditional methods of customer segmentation and modeling are slow and don’t scale well with rapid growth. In the

near future, marketing automation platforms will integrate with mobile devices, customer support screens, point of

sale terminals, in-store digital displays, and even traditional advertising platforms - to act as a central intelligence hub

for the design and management of the entire customer experience.

“Marketing automation and CRM systems still have a little way to go to give a holistic view into program performance

and how it influences the sale in terms of start to finish,” said Courtney Wilson, a senior revenue marketing manager at

Parata, a company that sells automation tools to pharmacies. “There’s just dots that don’t necessarily get connected.

I can look at programs and silos in terms of individual performance, but Salesforce isn’t really going to show me how

Bob became a lead, engaged in several touch points, became an opportunity, what influenced the sale over the course

of the sales cycle and closed the deal.”

4


4


After implementing marketing automation nearly two years ago, Parata had a specific goal in mind—to shorten the

typical sales cycle, which could be as long as 120 days. Because the sales staff was working with busy pharmacists,

many of whom were also independent business owners, closing the deal often takes a great deal of time and money.

Wilson and his staff designed an accelerated program through which current customers could share information

with those who were considering a purchase. Using this accelerated pipeline has shortened the sales cycle for these

customers by about 30 percent, Wilson said. Since hitting potential customers with too much too soon can backfire,

a detailed qualification process has been crucial to making it work.

“It comes down to making sure you know exactly what your sales process is,” Wilson said. In her view, ensuring that

your investment in a new marketing automation platform is a success comes down to a few key factors. “Know the

buying journey from start to finish. Make sure you really understand your buyer personas. Then have a defined sales

process in place. From there, make sure your CRM reflects that process and is integrated into it. Then build your

marketing automation programs on top of that so you are mapping your marketing efforts to the buying journey.

Finally, take a hard look at what’s actually going to move the needle.”

Think Like A Media CompanyA few years back, branded content sat somewhere on a spectrum between cheesy corporate videos and high end, expensively bespoke magazines and books.

The digital revolution changed everything. Now, most buyers - either in their

personal lives as consumers or in a professional capacity as business decision

makers - conduct extensive research online before making a purchase. That

research may take the form of a keyword search on Google, a pinboard on

Pinterest, a shared link on Facebook, a review on a customer forum, a blog

article, an ebook or a YouTube video. Bottom line - your brand’s visibility in

the future can be directly correlated to your investment in content.

As a CMO, your content strategy should

be driven by both the kinds of customers

you want to attract and the things

that motivate them.

5


Kraft Foods Group, for example, uses data to drive its editorial strategy.

When their team noticed a big increase in searches for green velvet cupcakes

on the St. Patrick’s Day holiday, they quickly developed a recipe with four

different Kraft ingredients, and shared it through their media channels. As

Deanie Elsner, executive VP and CMO at Kraft Foods, explained at the 2014 Ad

Age CMO Strategy Summit, “Data, going forward, becomes the new currency.”

A strong investment in content will be equally relevant whether you are a

luxury brand that collaborates with contemporary artists on commissioned

works, a technology company using whitepapers to establish thought

leadership, or a retailer creating videos to help customers decide between

competing brands. Great content, however is more than just hiring a handful

of former journalists. You need a proper battle plan.

http://www.kraftfoodsgroup.com/home/index.aspx


For marketing leaders, thinking like a media company means more than

just allocating a budget to content. It also reflects a shift in thinking from

using messaging as a promotional tool, to establishing a true dialogue

between a brand and its advocates.

5Kuno Creative, is one of the world’s leading inbound marketing and content

strategy agencies. Its approach is based on not just creating quality content,

but tailoring campaigns for specific buyer personas. One of its clients,

Invacare, was a company that provided portable oxygen concentrators for

those with respiratory ailments. The most common type of respiratory ailment

that leads to oxygen concentrator usage is Chronic Obstructive Pulmonary

Disease (COPD), a progressive lung disease that makes it difficult to breathe.

Rather than propose a standard product marketing campaign, Kuno worked

with Invacare’s marketing team to develop a web-based community for

those with COPD, their caregivers and their physicians. The result was

DoMoreWithOxygen.com, a site built with COPD sufferers in mind that

offered blog posts, tip sheets and eBooks with relevant information about

living with COPD.

The Do More With Oxygen website featured landing pages geared toward

several different buyer personas. Each landing page contained a form that led

to a relevant piece of content. Those with COPD filled out the form to receive

eBooks like “Travelling with Oxygen Made Easy,” while their caregivers received

eBooks like “Living with COPD: A Caregiver’s Guide.” Site visitors who filled

out forms were entered into a marketing automation platform, at which point

customized email campaigns were created to nurture them until they were

ready to convert into sales. In the first eight months of the campaign, the

website saw 54,000 visitors and captured more than 1,200 new leads.

http://www.kunocreative.com/

http://www.domorewithoxygen.com/

Forget Funnels, Focus On JourneysOne of the most persistent metaphors from the era of traditional marketing is the sales funnel.

The idea is that marketers build awareness at the top of the funnel with

advertising and promotional activities. Next they convert this engaged

audience into leads, which are then qualified into prospects before they

finally become customers.

The sales funnel reflected a world in which data was scarce and sales

teams were in charge. Before digital engagement platforms, sales

representatives were the gatekeepers of information. If you wanted

to know something about a product or service, a company’s sales rep

was the only way to get specs, comparisons and even testimonials.

According to data from Google and the CEB Marketing Leadership Council, 57 percent of business purchase decisions are

made before engaging with a supplier’s sales representative. The same thing happens in the consumer world, where 81

percent of retail customers do research online before walking into a store (GE Capital Retail Bank Major Purchase Shopper

Study 2013).

What has really altered the idea of the sales funnel, however, is not just online research but the consumer data that is

now available in real time while buyers are doing their research. Marketing automation software allows that data to be

visualized and acted upon immediately, at the level of an individual customer. Sales funnels were simply not designed

to take into account the journey an individual buyer might take in their decision making process, and when implemented

poorly in a marketing organization, frequently led to leaks such as not following-up or responding to the buyer’s previous

action or inaction.

6


This all changed with the rise of online research.

Instead of a funnel, modern marketers and salespeople must adjust the way they look at buyers – exchanging the macro-level funnel for a micro-level journey.

As you can see in the diagram, a personalized

perspective can take into account the data

collected on a buyer and utilize that to provide

targeted offers that guide buyers to the

information they need as they take their own

path to making a decision. Both buyer #1 and

buyer #2 are moving through a funnel of sorts,

but it is one shaped by their own interests and

content requirements.

Over the next few years, it will be easier to map and

influence the customer experience across both

physical and digital platforms. Better customer

data combined with psychographic profiles will

allow marketers to map a variety of possible paths

to purchase and then design customized offers

that support the customer journey.

6


Learning The New Language Of Data Driven MarketingMarketers still commonly use the concept of the sales funnel when selling strategies to internal stakeholders because it is

familiar, and they lack alternative metaphors. To change the way your organization thinks about marketing and sales, you

first have to change the language you use:

• Instead of the top of the funnel, say the start of the buyer’s journey

• Instead of the middle of the funnel, say personalized engagement

• Instead of the bottom of the funnel, say the end of the buyer’s journey

While we all know communication shouldn’t end when a buyer becomes a customer, the end of the journey signifies the

commencement of a new opportunity cycle in your CRM system with all of the contact points in the previous journey

collected as data that can support your predicative analytics.

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Redefine Your MetricsMarketing has never been short on measurements, although some of those metrics may have fallen short of actual meaning.

Like the Ptolemaic model of the universe that required complex explanations to prove the sun moved around the earth,

traditional marketing metrics also required their own suspension of disbelief. In the pre-digital world, proving the actual

impact of advertising was tough. So the success of campaigns was benchmarked with metrics like reach, frequency,

gross rating points, impressions, cost per thousand or cost per point. PR campaigns had an even tougher task of

establishing impact—resorting to measures like clip counts and advertising value equivalency scores.

Abstract measurement numbers made sense in a world with only a handful of media outlets, allowing brands to

effectively buy consumer attention. With a limited number of platforms competing for audiences, marketers could

quantify the entire universe of potential exposures, and then work out whether or not a brand’s messages reached their

targets in a cost-effective manner.

With the arrival of the Web, we attempted to translate these measures into a digital form—measuring media interaction

rates, cost per click, cost per interaction or cost per view. In reality, these were just the same old exposure metrics in a

new guise, and they did little to really justify the strategic contribution of new marketing to business growth.

Return On Investment (ROI) is not a hypothetical concept anymore. You don’t need a proxy based on channel spend

or media exposure. You can actually measure whether or not an individual, after marketing, has changed his or her

behaviour, become a customer, or even better, become an evangelist for your brand.

7


21st century CMOs need to take a new approach.

ROI is an aggregate concept suitable for talking to your board or CEO, but if are looking to fine tune your marketing

actions, you need to be focused on what it really costs you to acquire a new customer.

You can work out your CAC by adding up all of your sales and marketing costs (both the cost of your advertising

spend as well as the cost of your team) divided by the number of new customers gain over a defined time period.

Calculating your CAC will give you a deeper perspective into related performance metrics such as:

Once you can quantify the relative performance of your marketing efforts, the next step is to start assigning values

to potential customers as they start to engage with you. This is known as lead scoring.

With a lead scoring system in place, you can automate a large number of activities, all of which can contribute significantly to your growth objectives.

Lead scoring has many potential applications but the primary goal is simple: how do you help your sales team close

a deal? Whether you go strictly with a lead score or add an at-a-glance layer (like a lead grade) on top of the score,

your analysis will help sales focus their efforts on leads who are further along in the buying cycle, and in the best

position to be converted into customers.

• What is the ratio of marketing costs to your cost of sales?

• What is your customer lifetime value, and how does this compare to your acquisition costs?

• How many of your customers were actually gained or influenced by marketing?

• Alerting salespeople when a lead in their queue reaches a certain score.

• Sending an automatic email to a lead when she reaches a certain score.

• Changing a lead’s lifecycle stage to “marketing qualified” when he crosses a score threshold.

• Providing more specific content to a lead based on a combination of lifecycle stage and lead score.

• Updating a lead’s rating in CRM software from warm to hot.

7


In a time of greater visibility around marketing performance, the more useful number to track is not ROI but rather Customer Acquisition Costs (CAC).

The final measurement methodology worth paying attention to is closed-loop marketing.

A form of attribution modeling, closed-loop marketing involves collecting data about the customer journey, from

initial engagement to final transaction. It requires setting up a means of tracking your campaigns and then either

looping in your enterprise systems or maintaining open communication with your sales team about what leads they

received and what happens next.

Closed-loop marketing is essential in e-commerce. Companies like Amazon.com were early adopters of the Google

AdWords platform, selecting keywords and targeting them to appear next to Google search results when potential

customers looked for a specific item. As customers started clicking, Amazon captured information about what

motivated them to take action and compiled it all into massive databases. This information gave them a powerful

tool of customer insight. If someone looked at a particular book and didn’t buy it, Amazon could use retargeting to

remind them of it later. The company was among the first to offer an intensely personal online shopping experience

by showing items related to the ones you’ve looked at before and even make recommendations for you.

Amazon’s culture of experimentation and testing is one of the hallmarks of their success. As CEO Jeff Bezos has

said, “If you double the number of experiments you do per year you’re going to double your inventiveness.”

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How To Score Your LeadsBefore a lead enters your pipeline, your marketing and sales team need to agree on how to classify it. Your aim to is define the threshold of when an ordinary lead becomes a marketing qualified lead (MQL) - an individual more likely to become a customer based on your data intelligence. These factors will help you develop a scoring system:

EngagementEngagement scores are metrics easily obtained from your marketing

platform, such as page views, website visits, email open or click-through

rates. Social media interactions also indicate engagement, but be warned

- they don’t always translate into sales-readiness. In fact, engagement can

sometimes provide more false positives than any other type of criteria.

BehaviorBehavioral metrics go beyond the number of interactions your customers

have with your website and focus more on the type of interaction. Think

about where you would look if you were considering a purchase of your own

product or service. For example, if someone clicks on an ROI calculator, fills

out a needs assessment or lands on a pricing sheet, you should assign an

appropriate score to that action.

PersonaScoring based on persona is the most valuable type of scoring you can

do. For example, if you’re selling solar panels to homeowners, you might

discover that one of your most likely candidates has a certain income-level,

can utilize a local tax credit, or is more likely to be married than single. By

scoring based on these specific qualifiers, you can quickly determine if the

lead is the right match for further sales development. Disqualification is

just as important. While you might score a person with director or president

in his or her title, you may negatively score or even disqualify an associate

level employee.

Buy ProgrammaticallyWhile brands have made considerable progress in digital marketing, the actual process of buying media has until recently remained stubbornly analogue. Big advertising deals were typically arranged with a confusing mix of phone calls, emails, insertion orders and four martini lunches.

Real time bidding changed everything, allowing brands to buy online impressions from publishers via auction

systems, with computers making split-second decisions about what ad unit to serve. The classic application of

this technology was “retargeting”, whereby a consumer who viewed a product on a retailer site would then see an

advertisement for that same product a few minutes later when they jumped to another site. Marketers spent $3.1

billion on real-time bidding in 2013. Real-time bidding is expected to account for more than $18.2 billion in digital

advertising revenues in 2018.

That said, programmatic marketing is a much bigger idea than real time bidding,

Programmatic involves the use of data driven software to automate the entire process of advertising placement

and may in the future define the way that all media is bought and sold—even on traditional platforms. Publishers

and platforms are starting to realize that automation is not just relevant to low value inventory, but is also the most

appropriate method for pricing premium offerings as well.

The real power of programmatic is that it allows marketers to buy people rather than placements.

For CMOs, that doesn’t mean firing everyone in your strategic planning team, but simply that once you can automate

the transactional elements of buying and selling, your people need to be focused on more higher-value activities.

Programmatic platforms learn through feedback cycles what kinds of advertising really work for a particular

customer segment. Next generation planners can use those insights to constantly adjust their brand strategy, and

the design of the workflows that activate potential customers.

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With greater use of algorithms in the media buying process, we may see the end of “prime time”.

For example, if you can combine set top box data with online profiles, you might discover that one of your

customer segments watches a relatively unpopular TV show. This will then allow you to cost effectively target

those customers using broadcast marketing at a fraction of the cost of a prime time slot. This is a reversal of the

traditional TV formula - rather than using data about shows to find the right audience, marketers can use data about

audiences to find the right show.

“The magic of programmatic is that it’s about de-averaging and it’s about data,” said Jay Sears, senior vice

president of market development for the Rubicon Project, in an interview with Ad Week. “De-averaging means

you’re decomposing everything down to an impression level, and you’re using machines to look at it. You’re making

decisions in milliseconds—and it’s very easy to make those decisions at the impression level and then re-aggregate

them so you can continue to buy at scale.”

More data does not mean less creativity. Programmatic marketing instead encourages brands to constantly develop

compelling content while aligning messaging with an individual customer’s journey. If anything, programmatic

technology is an invitation to finally fulfill the promise of personalized engagement.

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Communicate Effectively With DataThe Crimea, 1855. Britain faced two enemies - Russia and disease. The legendary Florence Nightingale had done extensive statistical analysis of data that showed unsanitary living conditions led to high mortality rates, not the lack of food or supplies.

To fix the problem, Nightingale wanted the government to invest in hospitals and healthcare instead of guns and

ammunition, but she was afraid Queen Victoria and the members of Parliament would not read or understand her

statistical reports. So, in one of the world’s first examples of sophisticated data visualization, Nightingale created a

data rich infographic called a polar area diagram. Her “Diagram of the Causes of Mortality in the Army in the East”

was so evocative in its simplicity, it persuaded decisions makers of the need for reform by improving the sanitary

conditions of military hospitals.

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Like Florence Nightingale, tomorrow’s CMO has to play a critical role in not only finding the right kinds of data to make an argument for change, but bringing that data to life in ways that the rest of the business can understand.

Take predictive analytics as an example. You might invest in a platform that provides up-to-the-minute

recommendations about your marketing strategy, but unless you can present this data in a way that engages the

CFO and the finance team, it will be tough to reallocate your investments in real time.

Visualization works best when it provides the viewer with an awareness of contexts that otherwise wouldn’t exist.

That perspective is essential whether you’re considering launching a new product or service or trying to work out

the best way to cut costs. A good infographic is more than just a pretty picture. It can mean the difference between

making the right decision and making a multi-million dollar mistake.

Procter & Gamble’s immersive Business Sphere collects real-time business information so company leaders can

respond to data in a visual way. Working with Tibco Spotfire, over 50,000 P&G employees also have access to a

“Decision Cockpit” that contains a variety of real time business graphs. In one example, P&G’s system used supply

chain sufficiency models to illustrate multiple data points, resulting in an inventory reduction of 25 percent and

a savings of tens of millions of dollars. By bringing their data to life, P&G is changing the way its leaders make

decisions. In an interview with the Harvard Business Review, P&G’s CIO Filippo Passerini called it “getting beyond

the what to the why and the how.”

Visual data is not only relevant as an internal tool; it also serves as a way of sharing impactful stories with the wider world.

General Electric, for example, does a great job of capturing the imagination with its data. GE generates a quarter

of the world’s electricity. To communicate that idea, the company measured data from 713 of its turbines every

15 minutes for 15 days. The team then put together a striking visual representation to illustrate how GE’s turbines

generate power for homes and industries all over the world. Similarly, when the company sponsored the 2012

London Olympics, it leveraged that relationship to create a visualization of the last 100 years of world records for

the summer games. GE now uses visualizations in places as diverse as annual reports, customer whitepapers or

press announcements aimed at business media.

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http://www.pg.com/en_US/index.shtml

http://www.ge.com/


Five Data Visualization Questions To Consider

4:1

What is a complex decision you need to bring to your CEO that could be better explained visually?

Which of your business stories would make an ideal candidate for a data visualization video for YouTube?

What is the ratio of words to images in your presentation decks for both internal and external audiences?

If you had a world class data visualization team at your disposal, what project would you give them first?

If you had to make all of your decisions using just five real-time graphs, what would they show?

Build A Strong Relationship With ITOne of the defining executive relationships in the 21st century will be between the CMO and the CIO.

The marketing technology stack is getting more complex - both at the front end where your customers engage

with your products and services, as well as at the back end where all the orchestration of your business processes

takes place. Integration is key. Your new tool box of analytics, conversion optimization, lead nurturing, personalized

content, re-marketing, mobile engagement, marketing automation, loyalty management, and programmatic

marketing require deep integration into enterprise systems to be truly effective.

The rise of marketing technology has led some to argue that we will see the merger of the CMO and CIO position in

the enterprise. In truth, that is unlikely. CMOs have a lot more to worry about than just technology, and CIOs equally

have more on their hands than just building better marketing engagement platforms.

The source of departmental conflict has more to do with relative speeds of change.

For a number of years, traditional IT has lagged on the adoption of Cloud based marketing technologies, mainly

due to a lack of specific knowledge of the new marketing platforms necessary to provide useful feedback. That

is changing. The new generation of IT leadership is not only Cloud savvy; they are undergoing the same cultural

transformation toward agility, speed and adaptability as marketing teams are. Rather than blocking line of business

managers from making technology decisions, they want them to be more engaged and empowered – leaving IT

leadership to focus on the larger design of the enterprise technology stack.

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Shadow IT, where managers sidestep IT to buy their own managed services, is a strategic dead-end. Getting value out of marketing technology investments requires more integration with core enterprise platforms, not less.

In the future, marketing technology will be merely a utility and of little competitive advantage in and of itself.

Marketers will differentiate themselves not by the technology they own, but how they design unique customer

workflows and engagement programs. Another source of future advantage will be the richness of a brand’s data

management platform (DMPs). DMPs will allow brands to combine their own proprietary data with other sources for

more accurate targeting and personalized customer experiences.

Building a strong relationship with IT is essential if you want to reimagine the marketing organization

The CIO’s experience in managing complex systems, combined with the CMO’s expertise in consumer behaviour will

be a power relationship that will define your success.

Selecting the right marketing technology solution is the least difficult part of the road ahead for CMOs and their

teams. The real challenge is change management. How do you break down the existing mindsets, management

practices and departmental silos that have until now held you back?

The coming era of data driven marketing is not about just technology.

For the 21st century CMO, the future of marketing is about finding

new ways to make better decisions and design more compelling

experiences that delight the customer.

Mike Walsh brings the future to life for business

leaders and their audiences. He is the best-selling

author of Futuretainment and The Dictionary of

Dangerous Ideas. As CEO of Tomorrow, he advises

leaders on how to design their businesses for the 21st century

and thrive in this era of disruptive technological change.

Mike constantly travels the world as part of his extensive

innovation research program. He distills the most relevant

insights into high impact keynotes that allow any audience

to understand and influence their future. We look forward to

discussing your next event and how Mike can work with your

team to identify the key levers of change in your business.

Visit www.mike-walsh.com to learn more.

CONNECT WITH MIKE

IN COLLABORATION WITH

http://mikewal.sh/1uBySnk

https://www.youtube.com/user/michaelwalsh

https://twitter.com/mikewalsh

https://www.linkedin.com/in/michaelwalsh

https://www.facebook.com/mikejlwalsh

http://www.kunocreative.com/

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THE 21ST CENTURY CMO PLAYBOOK - Kuno Creative